Global Governance: Why isn’t it working and what can be done?

By Javier D. Spencer, Guest Contributor

At an exponential rate, the world is convulsing into a single space, which heightens the interconnectivity and interdependence of countries. As a result, it is evident that issues such as climate change, security, human rights among others, instantaneously alter global relations. It can be scary when you think about it, especially since matters arising are becoming more and more complex.

Our human response to address the complex issues at a global level is to increase the robustness of global governance through multilateralism. We could say that for almost every global issue (sometimes overlapping), there may be at least two or three global institutions created to address that one issue. This, evidently, creates a new global society that is constructed to bring order, reliability, predictability and transparency.

The New Global society eliminates a central authority and places emphasis on collaboration among states which will seek to encourage common practices and goals. However, as there is growing interdependence for economies to integrate into the global economy, we observe that global governance has acquiesced to the limitations and challenges of multilateralism. It is designed to promote international peace, stability and co-operation; but unfortunately, it does not work, as it should. For this reason, there are challenges arising in the dynamic global economy that undermines the effective institutional outcomes of global governance, including democratic deficits and accountability; representation and power; and compliance.

Democratic Deficits & Accountability

Democratic deficits are prevalent in global governance when nothing holds the institutions and regimes accountable to a democratic electorate. There is a divergence between ‘what is’ and ‘what ought to be’ in respect of trust by the masses in the governance regimes and institutions. For example, we have seen a proliferation of trade agreements, like the now defunct negotiations on the Transatlantic Trade and Investment Partnership (TTIP) between the US and the EU, and the Trans-Pacific Partnership (TPP) (which was replaced by the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) after the US withdrew from the TPP), that were being negotiated in secrecy. Secrecy violates the very basic concept of democracy. Citizens have the fundamental right to be aware and to be able to air their concerns on policies and legislation. The absence of this right results in the deficit as the perception of governance goes beyond the influence of the citizenry.

There is also a growing concern about lack of accountability at the global governance level.  Accountability includes transparency, consultation, evaluation, and correction. Transparency means that there is visibility present; eliminating decision-making done in secrecy. Additionally, consultation purports an explanation of intentions by one party, and flexibility to adjust plans that will negatively affect another party. Consultation then ushers in evaluation where there is an independent monitoring and assessment of activities; and in the final analysis, there is correction, which means that there are provisions for redress or reform.

Representation and Power

An overwhelming question on the issue of representation is, “whose interest do these organizations represent?”   Global Governance regimes were created by and for the most influential states that were too important to fail. Therefore, the goals and objectives are partially beneficial to the major actors in global system. For example, voting at the International Monetary Fund (IMF) remains weighted, which means that one state is does not equal to one vote. How is finance for economic development expected to be achieved? It automatically disenfranchises the global south in crucial development decisions.

Another case in point is the daunting process of ensuring that developing countries, more specifically Least Developed Countries, are able to participate in international trade at the multilateral level. Although the Nairobi Decision on Rules of Origin and Export competition enables greater LDC participation, facilitation remains elusive. Interestingly, the Nairobi round is a successor to the Doha Round. The Doha Round, which was coined a being ‘development’ oriented failed miserably after many years of negotiations. The main aim of the Doha Round was to further liberalize trade, invest more in development, and address complex global issues. However, the rounds’ failure illumes the shortcomings of global governance regimes, especially for developing and least developed countries.

There are, however, proposed problems of increased representation at the global governance level. There will be an increased inefficiency, as more participants in the decision-making process could hinder coming to a single decision, due to the diversity of interests and goals. However, inadequate representation results in skewed authority and power within the governance regime. Ultimate power is given to whom it favourably represents and vice versa, representation reflects to the economies with economic dominance and power. It becomes a case where “the strong will do what they can and the weak must accept what they must”.

Compliance

If all states are sovereign, who ensures that states comply with these rules to yield an ideal outcome in the governance of the international system?   The enforcement problem arises because that is no authoritative international government since states value their autonomy. For instance, the United States has iterated its right to ignore any rulings from the WTO’s Dispute Settlement Body. Therefore, to what extent are states willing to sacrifice their political autonomy for a well-functioning international economy? None.

So, what’s next? Reform? How?

In order to align with the original mandate of international stability, peace, and cooperation, issues of democratic deficits and accountability; representation and power; and compliance must be addressed through speedy reform. The start of attaining reform is by identifying an effective global mechanism that provides strategic guidance. Global issues today are closely knitted into a web. Therefore, strategic guidance must view the international system as a whole.

At present, there are sufficient agencies created to tackle emanating issues. As such, there is no need to recreate the global governance regime. Instead, the existing structure needs to be appropriately matched to issues, in order to strengthen its efficacy.

This will certainly result in a change in the global agenda. An agenda that is inclusive, modern, flexible, agile, and resilient.  This envisioned modern-day agenda will mitigate the democratic deficit and increase accountability, linking leadership, vision and institution. An inclusive agenda fosters participation, which balances representation and power. Reform needs to happen faster.

Javier Spencer, B.Sc., M.Sc., is an International Business & Trade Professional with a B.Sc. in International Business and a M.Sc. in International Trade Policy. His professional interests include Regional Integration, International Business, Global Diplomacy and International Trade & Development. He may be contacted at javier.spencer at gmail.com.